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22nd December 2017

Brexit and Acquired Rights: a fishy case.

Much has been said of the prospect of a shower of litigation raining down on the English civil justice system as the UK departs the EU arena, stage right. But, will this be how events unfold?
Undoubtedly lawyers up and down the country will be exploring the angles for clients who are adversely affected by the adjustments that need to be made to the UK’s legal infrastructure on exit. So what might English Law offer businesses who would argue that by the UK’s membership of the EU, they have legal rights with which the withdrawal is going to interfere. Might there be a route to claim compensation or other relief from the State in consequence?

A reality check.

Article 70 of the 1969 Vienna Convention on the Law of Treaties addresses the consequences of termination of an international treaty. Under the Convention, whilst such a termination may release the parties from their obligations to perform the treaty, it will not affect any right, obligation or legal situation created through the execution of the treaty before its termination. Would that preservation of rights suggest a decent starting point for the analysis here? Not obviously, no. Even if a withdrawal from the EU Treaties did amount to a relevant termination, the Vienna Convention cannot be said to safeguard a citizen’s rights under EU Law as it is referable to States – the parties to the treaty - and not to individuals, companies or other legal persons. Public international law is therefore unlikely to come to the rescue of a complainant by that route.

So where else might a complainant look? Can the law provide a remedy for the deprivation of legal rights by a State’s actions? Again, the doctrine of ‘acquired rights’ in private international law is strictly limited both as to its scope and its capacity for enforcement and those who seek to mine its depths may well find themselves bruised in the shallows. Nevertheless, might it be worth testing?

It is recognised that the ‘acquired rights’ doctrine can protect certain property rights, however those rights have to be “vested” and not based on some “contingent expectation”. They must also have an economic value that suggests they are capable of being transferred. What sort of right might be relevant in that context therefore?

Perhaps a fishy right: 1983 saw the introduction of the European Common Fisheries Policy with its scheme of total allowable catch for certain fish stocks across community waters. The development of the policy ultimately led to the present system based on an “Allocation of fishing opportunities” or quotas. The UK’s scheme in the EU system involved the establishment of a register of quota units for fishing vessels, with units attached to a licence. The operation of the scheme was considered in the 2013 English Administrative Court case of The UK Association of Fish Producer Organisations v Sec of State for the Environment, Food and Rural Affairs. In reviewing the scheme in the case, Mr Justice Cranston decided that “… fixed allocation quota units are possessions falling within Article 1, Protocol 1 of [the European Convention on Human Rights - ECHR]”. He reached this interesting conclusion because it was clear that fixed quota allocations had a monetary value and could be traded.  

Essentially, the Court recognised a fishing quota allocation as ‘property’ - which is significant, as ‘property rights’ tend to matter under English Law. Article 1 of the ECHR, which has force of English law (and will continue to do so on Brexit), provides specific protection for property rights – every natural or legal person being entitled to peaceful enjoyment of his possessions.

So here we have a right to which an individual or organisation might be entitled under English law that owes its existence to the European system and can thus be expected to be affected by Brexit and might also attract protection by the Courts. An English Law property right derived and transported from an EU regulatory scheme that may be rendered nugatory in respect of the UK.

The fish quota case is a good example however of the difficulties of attributing legal causes of action to the acts of a State on the international plane. At its heart this was a claim that the substantive legitimate expectations of holders of quotas derived from English and EU law were being unlawfully frustrated by the UK Government’s alterations to the scheme; alterations which it was claimed deprived a quota holder of a possession. However, one reason why the claim was rejected could be found in the scheme itself – that it was inherent in the character of the allocation that for any one year the quota might be substantially reduced from a previous year, even to zero, depending on the decision of the Council of Ministers. There was no right to a specific amount of fishing stock ahead of annual Ministerial decisions on quotas, so the proprietary character of the quota had nothing to which it could attach.

Add to that the fact that the protection given to property rights by the ECHR is by no means unqualified (it can be derogated from if justified) and that enforcement of qualifying acquired rights is far from straightforward, and you can see how difficult a legal complaint could be. Very complex and tricky.

Those caveats all said, we are marching into entirely unchartered legal territory and therefore whilst expectations need to be kept in check, there will unquestionably be cases that will justify careful examination and might support action.

All very Brexit - Lots of questions and a dearth of answers.

 

Dominic Hopkins is head of Disputes and Litigation at Hewitsons and an Associate Member of the UK Constitutional Law Association. For more information please contact Dominic on 01604 233233 or click here to email Dominic
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